Bruce Freeman writes a column called the Small Business Professor for Scripps Howard News Service. He talked with Jordan Peterson of PNC Bank this week about getting money to expand your business:
Peterson: The most critical component of growing any business is managing your cash flow. A company’s cash flow is made up of several variables, including payments, money coming in, and access to cash.
If you’re looking to expand, but lack the cash, your access to credit becomes a critical component. Some options:
A line of credit. Are you adding new customers and purchasing additional inventory or raw materials to produce your new product? If so, a business line of credit can help cover cyclical cash shortage during the time it takes to get your product to market.
Term or installment loan. If you plan to buy new equipment or need more space, banks have money to lend to small businesses.
Remember, the most challenging period to obtain financing for a business is when there is an urgent need for cash. It’s very important to maintain a close line of communication with your local banker.
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